GST effect on car prices?

This is a discussion on GST effect on car prices? within The Indian Car Scene, part of the BHP India category; With all states agreeing to rollout of GST from 1st July in today's meeting it's almost a done deal. I ...

With all states agreeing to rollout of GST from 1st July in today's meeting it's almost a done deal. I would expect more OEMs to offer discounts this month to avoid drop in demand in June (in models where prices are expected to fall).

I happened to visit Ford dealership today to check out the new Endeavour. Since this segment (ex-showroom: 25.5L / OTR: 29.91L) is expected to have lowered taxation under GST regime, so the dealership is offering an outright discount of 50K till 30th June.

Similarly, Mercedes dealership is offering discount as much as 3L as of today.

These discounts clearly show, the prospective buyers are holding back and waiting for GST for a better price while for dealerships it is important to ensure stock regularly keeps moving out of their stock yards. Certainly, these dealerships aren't really happy with GST coming in, atleast today.

Thanks,
Simmi

Discounts on the endeavour have been going on for a while on the base entry level models.
Same for Mercedes - in fact they've cut prices by 4% roughly citing GST. Mentioned on this thread somewhere IIRC.

But yes, with GST roll out confirmed - a lot of dealers and manufacturers will have to offer incentives to draw in customers this month.

Most of the luxury brands; Audi, Jaguar, Mercedes, BMW are offering pre-GST discounts already, as mentioned before on this thread. But some are offering discounts above and beyond that as well, by bringing the ex-showroom prices down to what you can expect from 1st July, and further offering the discounts that they had anyway on older models; such as the Jag XJ, BMW 5 series (new model is launching on the 29th of June).

I went to the Volvo showroom and they are not giving any extra discounts on account of GST.
In fact, when I told him about Mercedes, BMW etc, he said the company has told him that prices of CBU will go up by 2% because of GST. and that the others were CKD and may enjoy benefit.

BUT if VOLVO India is holding a lot of cars or if some dealer is having a large inventory, then they may like to sell before GST as Government has allowed only 60 % credit to of their total GST liability against the excise duty already paid on the goods purchased before July 1. They will have to charge GST extra on cars they sell from July 1 but must have paid CVD ( Excise ) at the time of clearance at Port for which they will get only 60 % adjustment against GST Liability. So, in my opinion, everyone should be eager to sell existing stocks unless I have understood wrongly.

BUT if VOLVO India is holding a lot of cars or if some dealer is having a large inventory, then they may like to sell before GST as Government has allowed only 60 % credit to of their total GST liability against the excise duty already paid on the goods purchased before July 1. They will have to charge GST extra on cars they sell from July 1 but must have paid CVD ( Excise ) at the time of clearance at Port for which they will get only 60 % adjustment against GST Liability. So, in my opinion, everyone should be eager to sell existing stocks unless I have understood wrongly.

I also have been looking out for a new Endeavour but the GST rollout has put my plans on hold.

Ford dealers are offering about 1 lac off on the total on road price (including the 3rd year warranty and mats n all). However, Ford seems to have increased the prices in anticipation of the GST reduction in prices.

So i expect about 1.5-1.6 lacs less than the price now. But discount would go.

I also have been looking out for a new Endeavour but the GST rollout has put my plans on hold.

Ford dealers are offering about 1 lac off on the total on road price (including the 3rd year warranty and mats n all). However, Ford seems to have increased the prices in anticipation of the GST reduction in prices.

So i expect about 1.5-1.6 lacs less than the price now. But discount would go.

Has there been another price increase? As far as I remember there was one in April.

I am just wondering will there be a new segment coming in called Sub 10 Lac just like the Sub 4 Meter in India? Cars like City and Ciaz being just crossed 10 lacs, I am assuming manufacturers will bring it below 10 to avail the GST benefit, hope so.